Blog

On 26 March 2025, Chancellor Rachel Reeves presented her Spring Statement to parliament. Here are the key announcements relevant to you and your business.

‍

KEY ANNOUNCEMENTS

‍

• Steadfast Commitment to Economic Growth:
  Despite a downward revision in short-term growth forecasts from 2% to 1%, the government remains dedicated to fostering economic expansion.

‍

• Boosting Defence Spending:
  In response to a rapidly evolving global landscape, defence spending will see a significant increase.

‍

• Welfare System Overhaul:
  Stricter tests for personal independence payments are part of the changes to the welfare system.

‍

• Civil Service Transformation:
  The civil service will be streamlined with the introduction of an accelerated new Transformation Fund.

‍

• Investment in Housing:
  There will be increased investment in social and affordable housing.

‍

• Addressing Skills Shortages:
  Efforts will be made to tackle skills shortages, particularly in the construction sector.

‍

• Reduction in Tax Evasion:
  The Chancellor highlighted the government's commitment to reducing tax evasion, with investments in technology and HMRC capacity expected to raise an additional £1bn in revenue.

‍

• Upcoming Spending Review:
  The results of a spending review, which will allocate government spending for the three years from 2026/27 to 2028/29, will be announced on 11 June 2025.

‍

• R&D Tax Relief Advance Clearances:
  HMRC has opened a consultation until 26 May 2025 to better target non-compliant companies while assisting those making accurate claims. Discussions include mandatory advanced assurance for high non-compliance areas, voluntary assurances for high-potential companies, and limiting the service to customers using registered agents.

‍

• Making Tax Digital (MTD) for Income Tax:
  A new policy paper announced the expansion of MTD for Income Tax to include more small businesses from April 2028, extending to sole traders and landlords with income over £20,000.